Bennett v. Cracker Barrel Old Country Store

THIS OPINION
HAS NO PRECEDENTIAL VALUE.  IT SHOULD NOT BE CITED OR RELIED ON AS PRECEDENT IN
ANY PROCEEDING EXCEPT AS PROVIDED BY RULE 268(d)(2), SCACR.

THE STATE OF SOUTH CAROLINA

In The Court of Appeals

Kathleen Ragin
Bennett, Respondent,

v.

Cracker Barrel
Old Country Store, Employer, Gallagher Bassett, Carrier, Appellants.

Appeal From Clarendon County

 George C. James, Jr., Circuit Court Judge

Unpublished Opinion No.  2009-UP-392

Heard June 10, 2009 – Filed July 16, 2009

REVERSED

Darryl D. Smalls, of Columbia, for Appellants.

Richard W. Simmons, II, of Columbia, for Respondent.

PER CURIAM:  After
suffering a shoulder injury at work, Kathleen Ragin Bennett sought workers'
compensation benefits from her employer, Cracker Barrel Old Country Store, and
its insurance carrier, Gallagher Bassett (collectively "Cracker
Barrel").  The single commissioner and the Appellate Panel of the Workers'
Compensation Commission (Appellate Panel) awarded her benefits based upon her
hourly wage and reported tips, and the circuit court reversed.  Cracker Barrel
appeals from the circuit court's order requiring recalculation of Bennett's
average weekly wage and compensation rate.  We reverse and reinstate the order
of the Appellate Panel.

FACTS

Bennett
worked an average of thirty-two hours a week as a server at Cracker Barrel. 
She was compensated at a rate of $2.41 per hour plus tips.  As was customary
for wait staff, Bennett reported eight percent of her sales as tips to Cracker
Barrel.  These reported tips placed Bennett's earnings above the federally
mandated hourly minimum wage.  She did not report the actual amount of her tip
earnings, which she and Cracker Barrel agreed exceeded eight percent of her sales,
to Cracker Barrel or to the Internal Revenue Service. 

On
November 18, 2004, Bennett injured her left shoulder while lifting a large urn
of tea at work.  Despite the injury, Bennett worked for two additional weeks
before seeing a doctor, and her shoulder ultimately required surgery.  Bennett
filed an application for workers' compensation benefits.  The single
commissioner awarded Bennett medical and temporary total disability benefits
using an average weekly wage based only upon the wage and tip earnings she
reported to Cracker Barrel.  The Appellate Panel affirmed.  Bennett appealed
the calculation of her average weekly wage to the circuit court, which reversed
and remanded.  Cracker Barrel appealed to this court.

STANDARD OF REVIEW

In
reviewing workers' compensation decisions, the appellate court ascertains "whether
the circuit court properly determined whether the [A]ppellate [P]anel's
findings of fact are supported by substantial evidence in the record and
whether the [P]anel's decision is affected by an error of law."  Baxter
v. Martin Bros., Inc., 368 S.C. 510, 513, 630 S.E.2d 42, 43 (2006); see
also S.C. Code Ann. § 1-23-380(5) (Supp. 2008).  Generally, "'[c]ourts
defer to the relevant administrative agency's decisions with respect to its own
regulations unless there is a compelling reason to differ.'"  Neal v.
Brown, 374 S.C. 641, 649, 649 S.E.2d 164, 168 (Ct. App. 2007), cert. granted May 30, 2008 (quoting S.C. Coastal Conservation League v.
S.C. Dep't of Health & Envtl. Control, 363 S.C. 67, 75, 610 S.E.2d 482,
486 (2005)). 

LAW/ANALYSIS

Cracker
Barrel argues the circuit court erred in remanding this matter to the Appellate
Panel for recalculation of Bennett's average weekly wage.  We agree. 

The compensation rate for a total disability award is equal to
sixty-six-and-two-thirds percent of the claimant's average weekly wage.  S.C.
Code Ann. § 42-9-10(A) (Supp. 2008).  A claimant's average weekly wage
means:

[T]he earnings of the injured employee in the employment in which
he was working at the time of the injury during the period of fifty-two weeks
immediately preceding the date of the injury . . . .  "Average weekly wage"
must be calculated by taking the total wages paid for the last four quarters
immediately preceding the quarter in which the injury occurred as reported on
the Employment Security Commission's Employer Contribution Reports divided by
fifty-two or by the actual number of weeks for which wages were paid, whichever
is less. . . . .

When for exceptional reasons the foregoing would be unfair, either
to the employer or employee, such other method of computing average weekly
wages may be resorted to as will most nearly approximate the amount which the
injured employee would be earning were it not for the injury.

Whenever allowances of any character made to an employee in lieu
of wages are a specified part of a wage contract they are deemed a part of his
earnings.

S.C. Code Ann. §
42-1-40 (Supp. 2008).  If the claimant and the employer are unable to agree on
a fair rate of temporary compensation, and subsequently if the claimant
disagrees with the Workers' Compensation Commission's administrative
recommendation, the claimant may file a Form 50 requesting a hearing.  25A Reg.
67-1603(C) (Supp. 2008).  In these circumstances, the average weekly wage and
compensation rate are issues to be determined at the hearing.  25A Reg. 67-606
(Supp. 2008). 

Here, Cracker Barrel bore the initial burden of providing wage
information.  The information it provided consisted of Bennett's hourly wage
plus the tips she reported.  However, no evidence indicates anyone other than
Bennett ever possessed information about her tip earnings beyond what she
voluntarily reported.  The record reflects Cracker Barrel's payroll records
included a notation that "servers must report one hundred percent (100%)
of all tips received."  Despite this notation and her assertion she
consistently earned more than she reported, Bennett elected to report to
Cracker Barrel an amount equal to eight percent of her sales, the minimum
amount that would enable her to pass her employer's daily audit.[1]  Aside from
Bennett's reports, we see no indication Cracker Barrel had any means of
ascertaining her actual tip earnings. 

By filing a Form 50 challenging Cracker Barrel's calculation of her
average weekly wage, Bennett invoked an "exceptional reasons"
analysis of her earnings.  See § 42-1-40; Reg. 67-1603(C).  Subsequently,
Bennett presented testimonial evidence supporting her claim of unreported tip
earnings to the single commissioner, who then awarded Bennett benefits.  The
Appellate Panel adopted the order of the single commissioner and therefore all
the findings of fact and conclusions of law therein.  In doing so, the
Appellate Panel concluded the law required that "[e]arnings for a tipped
employee such as a waitress include hourly wages and tips."  This
conclusion did not exclude any unreported tip earnings.  Rather, the order approved
use of the exceptional reasons analysis and consideration of any wage records Bennett
submitted into evidence.  As a result, we find the decision of the Appellate
Panel included consideration of all tip earnings, reported and unreported, as
well as an implicit finding the evidence of unreported tips Bennett presented was
not credible.  Consequently, the circuit court erred in remanding this matter
for recalculation. 

CONCLUSION

We
find the decision of the Appellate Panel properly included consideration of all
tip earnings.  Accordingly, the order of the circuit court remanding this
matter for recalculation is reversed, and the order of the Appellate Panel is
reinstated.

REVERSED.

THOMAS
and KONDUROS, JJ., and CURETON, A.J., concur.

[1] Bennett notes in her brief that it is common in the
restaurant industry for employers to require servers to report eight percent of
their sales as tips.  It appears Cracker Barrel enforced this requirement by
conducting a daily audit that compared each server's sales with her reported
tips.  A server who reported tips equaling less than eight percent of her total
sales was required to make up the deficit in the tips she reported the next
day.